A group of legislators has urged the government to use surplus from the Unemployment Fund to reinstate the annual pension increases for retirees.
The proposal to amend the 2006 Insurance against Unemployment Law has been presented by five MPs led by Strategic Thinking Bloc spokesman Khalid Bu Onk.
It would allow authorities to use surplus from the Unemployment Fund to temporarily revive and implement the annual pension increases until the main pension funds – the Civil, Military and Social Insurance Funds – reach a financial surplus.
“Retirees are facing tremendous pressure due to inflation and the rising cost of living,” Mr Bu Onk claimed.
“While their entitlements remain stagnant, we have a surplus of around BD500 million in the unemployment insurance account. It’s time we put that to good use.”
Parliament’s financial and economic affairs committee has supported the proposal with chairman Ahmed Al Salloom noting the financial strength of the unemployment insurance fund.
“According to the latest audited reports, the fund had net assets of around BD500m,” Mr Al Salloom said.
“This is due to annual surpluses in contributions over paid benefits – BD54.4m in 2023 alone. We must consider using these reserves responsibly to alleviate the pressure on the pension system without compromising the fund’s core purpose,” Mr Al Salloom added.
Parliament’s services committee chairwoman Jalila Al Sayed also backed the proposal, but underscored the need for government co-ordination.
“The idea is innovative and socially conscious,” she said. “But we need a thorough policy review with the government, especially since it touches on multiple pension schemes and financial frameworks.”
The Military Pension Fund responded that the proposal necessitates further co-ordination with the government, and their formal position will be included in the government’s upcoming memorandum on the draft law, upon approval and submission.
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